Economics and Climate Change

What are the potential costs of cutting greenhouse gas emissions? What are the consequences of failing to reduce emissions? How effectively will different policy options achieve climate goals? These questions are frequently raised as the United States and other nations respond to the challenge of climate change.

Advancing public and private policymakers’ understanding of the complex interactions between climate change and the economy is critical to taking the most cost-effective action to reduce greenhouse gas emissions. C2ES works to inform this understanding by bringing sound, credible analysis to the discussion of potential costs and benefits of climate change policy.

Any effort to significantly limit greenhouse gas emissions will require changes in economic activity that will likely impose costs on society. The costs of climate change mitigation reflect the magnitude of the emissions reduction, the timing of these reductions, and the means of implementation. But left unaddressed, climate change will also impose costs on society. These costs are likely to increase over time, making it important – economically and environmentally – to take immediate action on climate change.

C2ES’s Economics Program contributes to the analyses of proposed policies that have the potential to reduce greenhouse gas emissions and limit the consequences of a changing climate system. The Economics Program also works to identify what the costs of inaction will be, in an effort to highlight the urgent need for policy action.